Explain what a contract of adhesion is. How does the doctrine of reasonable expectations influence adhesion?
What will be an ideal response?
Insurance is a contract of adhesion which means that any ambiguous terms or features in the contract are construed against the writer of the contract. This arises out of the unequal bargaining position and knowledge of the parties to the contract. Reasonable expectations doctrine produces coverage even though the contract does not call for payment when the reasonable expectations of insureds would result in a claim payment.
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In ________, the seller charges a separate price to each customer depending on the intensity of his or her demand
A) second-degree price discrimination B) third-degree price discrimination C) psychological discounting D) special-customer pricing E) first-degree price discrimination
Lower of cost or market:
A. Is only applicable to companies using FIFO. B. Is only applicable to companies using LIFO. C. Is applied to each individual item, major categories of items, or the whole inventory. D. Reports all inventory items at full cost. E. Records only an increase in inventory value.
Which method of preparing the operating activities section of a statement of cash flows adjusts net income to remove the effects of deferrals and accruals for revenues and expenses?
A) The direct method B) The indirect method C) Both the direct and indirect methods D) Neither the direct method nor the indirect method
Which of the following statements regarding lot-sizing is TRUE?
A) EOQ principles should be followed whenever economical. B) Too much concern with lot-sizing results in false accuracy. C) Lot-for-lot cannot be modified for scrap allowance or process constraints. D) The Wagner-Whitin algorithm simplifies lot size calculations. E) All of the above are true.